EchoStar stock surged on Monday after the Charlie Ergen-controlled company announced a spectrum sale to Elon Musk's SpaceX for approximately $17 billion, including $8.5 billion in cash. SpaceX's Starlink satellite network plans to use the spectrum. Shares in AST SpaceMobile and Iridium Communications fell on the EchoStar-SpaceX deal.
Starlink, AST and Iridium compete in providing space-based cellular broadband networks, differentiated by their ability to enable some types of everyday smartphones to connect to orbiting satellites.
Shares in the nation's three biggest wireless firms fell on Monday amid the EchoStar/SpaceX deal.
Meanwhile, Globalstar[ticker symb=GSAT] stock jumped. Globalstar owns spectrum licenses.
On the stock market today, EchoStar stock jumped nearly 20% to close at 80.63. With the gain, EchoStar stock has climbed 215% this year. EchoStar popped in late August on a spectrum sale to AT&T.
Shares in AST SpaceMobile fell 3.9% to close at 40.77. AST stock has climbed 87% in 2025. Iridium stock fell nearly 15% to close at 21.39. Globalstar stock popped 21.5% to close at 37.94.
Under the SpaceX deal, SpaceX also will fund about $2 billion of cash interest payments on EchoStar debt through November 2027. Also, EchoStar's Boost Mobile wireless business will access SpaceX's satellite-to-mobile phone service. EchoStar also has a wholesale network deal with AT&T.
Will Musk Challenge AT&T, Verizon?
Craig Moffett, analyst at MoffettNathanson, said T-Mobile US should gain.
"T-Mobile's pre-existing agreement with Starlink to provide D2D (direct-to-device) service in remote areas was already arguably advantaged versus Verizon and AT&T's partnership with AST," he said in a report. "Now it will be dramatically more so. Verizon and AT&T will be commensurately disadvantaged."
Aside from AT&T and Verizon, AST's partners include Vodafone. AST has agreements with more than 45 network operators.
Shares in AT&T, Verizon and T-Mobile all fell on Monday. One view is that Musk, a tech maverick, could be eyeing a satellite phone service competitive with AT&T and Verizon.
Raymond James analyst Ric Prentiss said in a report: "We still believe in the laws of physics and that satellite connectivity will be complimentary, not competitive, with terrestrial cellular and used when customers 'Go Off the Grid'."
At Bernstein Research, analyst Laurent Yoon said in a report: "This is Elon Musk we're talking about — someone anything but traditional. With access to cheap capital, could he actually scale this? The 'traditional' perspective finds this hard to imagine, especially in the near-term but we leave the possibility open for the long haul. There is a bigger role for satellite connectivity over time as economics improve, driven by technology, scale, and potentially enabled by cheap capital."
EchoStar Has More Spectrum Left
In August, AT&T agreed to buy low-band and midband wireless spectrum licenses from EchoStar in a $23 billion deal. Further, AT&T will acquire about 30 MHz of nationwide 3.45 GHz mid-band spectrum and about 20 MHz of nationwide 600 MHz low-band spectrum for about $23 billion. The all-cash transaction is expected to close in mid-2026.
Prior to the spectrum sales, EchoStar had struggled to pay down debt amid FCC deadlines to build out a 5G wireless network. Also, EchoStar recently announced a new foray into global LEO wideband satellite services. However, those LEO plans are dead amid the SpaceX spectrum deal, Moffett said.
However, EchoStar still owns spectrum that could be monetized, analysts noted. "The game is far from over for EchoStar and the industry," Yoon said.
At TD Cowen, analyst Gregory Williams in a report said EchoStar may hold onto its remaining spectrum for a while.
"With the FCC dispute now resolved, EchoStar is not a forced seller," he said. "EchoStar now has an excellent balance sheet and liquidity, and may desire to hold onto the spectrum as long as possible for higher sale valuations at a later date. EchoStar is in a position to keep all of its options open and see how the (Boost Mobile service) develops."
EchoStar continues to sell satellite TV services but subscribers have been declining. In the June quarter, EchoStar revenue fell 6% to $3.725 billion, missing estimates of $3.829 billion.
EchoStar Stock Technical Ratings
But EchoStar added 212,000 wireless subscribers, well above consensus estimates of 66,000. It had 1.55 million wireless subscribers at the end of June.
Meanwhile, EchoStar stock holds an Accumulation/Distribution Rating of B, according to IBD Stock Checkup. That rating analyzes price and volume changes in a stock over the past 13 weeks of trading. A+ signifies heavy institutional buying; E means heavy selling. Think of a C grade as neutral.
Also, EchoStar stock holds an IBD Composite Rating of 69 out of a best-possible 99. IBD's Composite Rating combines five separate proprietary ratings into one easy-to-use rating. The best growth stocks have a Composite Rating of 90 or better.
Follow Reinhardt Krause on X, formerly Twitter, @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.
